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The questions you are asking indicate you are a newbie with no experience.

The price is NOT free. When you take ownership storage charges start. A project of this type takes 3+ years, if you KNOW what your doing. IF you get it done in 3 years you have a boat which is a monument to your skill in which you have sunk a ton of money. When you are done you have a boat that most people wouldn't buy on a bet. Most people want a factory built boat with no modifications. Strongly suggest you purchase a boat in good shape - make the payments - and ride and have fun during the time you would have been doing a reconstruction. Read the Sticky on inexperienced newbies in the start of this section.

If you do decide to do it PLEASE document it with pictures and keep the forum updated. Also 12 is too narrow look for a 14.

If you have tons of money and you love this type of project have at it. Steamboat Willy did this (exception to the rule - his boat is sell able) I don't know if he would do it again or not.

It depends on what you want to do. If you want to have exactly what everybody else has, if you want to worry about resale value, if you want to go houseboating next weekend, if lightweight fit and finish suits you, you need to buy a ready-made unmodified houseboat, as advised by all the people who bought ready-made, unmodified houseboats. I will bet there are some bargains out there, people who paid top dollar for a dock queen, and never mustered the nerve to go anywhere with it.

If you are a very handy fellow, if the construction process is what you're looking for, not necessarily the product, if you don't mind that you're likely to get bogged down in the details, and have the boat sit while you figure out the next steps, if you really want something altogether different, a unique floor plan, with very high quality finishing rather than quarter-inch plywood fake-wood paneling, maybe with controls where you can see where you're going, then maybe building your own house on a readymade hull might be just down your alley. You will, of course, want a surveyor to look carefully for the rot you were warned of, to make sure you are buying something that will last longer than it takes to finish building it.

My husband decided to build a houseboat from scratch, without plans, and without any nautical experience between his boyhood Sunfish and his stint on an aircraft carrier. We were warned how totally foolhardy that was, that the boat would likely be a mortal danger to its dimwit owner and everybody else in its path. That it would turn out to be hugely expensive, would take forever, and that we would never get rid of it. I have to say, some of this advice is totally right. Some of it, so far, is not. We are a decade into this crazy project, and the process has been fun for a guy who likes to tinker, who really doesn't care if we ever go anywhere farther than 25 miles away with it. We have made a lot of fascinating friends, we have learned some lessons, some good, some less so. It is taking a lot longer than anticipated, and we are already having to replace some parts of it that have deteriorated, there are a few leaks between house and deck we haven't gotten ahead of. I am very pleased with the backwards floor plan. The outboard motors work just fine, the hulls are stable and dry. It tracks very well, turns 360 degrees in its own length, and handles chop surprisingly well. We inadvertently got into one of the Albemarle Sound's infamous surprise blows a while back, and found it handled the 3-foot seas with a great deal of creaking and pitching, but no damage. We're gradually getting the hang of backing into our backyard slip without scraping paint. But all this is a bonus. The point for him was to take on a huge and complex retirement challenge, not to have a place to live, or a showplace vacation boat or a long-term investment, or a way to see the world. By his criteria, the learning opportunities, the crazy project ones, especially, it continues to be a success. By anybody else's, it continues to be utter folly. You pays yer money, you takes yer choice! Either way, it ain't gonna be cheap.

A lot like what Amelia says. IF you have the skills you can do it and build what YOU want. But it will cost you 2-3 times what you expect, not counting labor. All things considered, not what I'd recommend, unless you have good skills and lots of time. I used to have a "slideshow" on Photobucket but can't find it. I bought the old barge for $2k, and sold the engines for 1k... then sunk another 30k and more into it. It's now 40+ years old and probably uninsurable. I may have to give her away when I'm done.

But I have to reiterate, it is rewarding but it is NOT easy and it's is NOT cheap. If you don't have good skills, (woodworking, electrical, plumbing, engines, fiberglass, you-name-it) don't even try, you'd end up with a very expensive P.O.S.

Turns out the slideshow IS still there... just click on the link in the signature.

The biggest decision you have to make is that for the next several years, do you want your hobby to be boating or boat restoration?
Many restorations projects go on for about 10 years or more and some never get finished. Seems like after so long of building and restoring and no boating, the charm wears off.
If boating was your original motive, you can never replace all the years you didn'y.

I rebuilt a Crest pontoon houseboat that we now use. I added 7' of deck and swim platform to make the original 35 footer into a 42 foot boat. To do that I fabricated auxillary pontoons out of plywood and fiberglass to extend the rearend. The boat rides level and performs perfect. After 7 years in the water my home-made pontoons are still tight and dry. The finish is simply 100% acrylic housepaint and after all those years immersed in the water the paint hasn't blistered or peeled anywhere. I tell other boaters don't waste your money on Marine paint.
You guys are probably right about that hull having a lot of rot.
I did see a boat for sale where they basicly did my idea --- the forward part of the cabin they left intact. The rear section that steps down they brought the floor up level with the forward section so now it's walk-thru and brought the cabin out on each side eliminating the catwalks. It not only has the original forward lower-level cabin but one amid-ship also.

I think you have a pretty good idea of what you'd be getting into, Mark. And would probably enjoy the process as well as the product. If you get yourself a hull you're happy with as a foundation, rather than building pontoons, you'd be months ahead of the game, right? And most handymen work a LOT faster than, (ahem,) some people I know. I think production houseboat builders, in an attempt to sell the summer-long party fantasy, try to fit as many bunks in as possible, thus all the steps. Like you're really going to spend the week aboard with your fourteen best friends? NOT! The beer manifest alone would sink you. So, I think your idea is probably a practical one, all on one level. Maybe the multi-level eight-claustrophobic-stateroom, many teensy heads- thing is unnecessary complexity for the way you would use your boat.

One 'great idea' I had that didn't turn out to be all that wonderful, was to bump the head space out to take up some of the catwalk along the starboard side. Darn! That is the side we prefer to dock on, and I didn't think at the time we would miss that unobstructed full-length exterior access. But, as it turns out, I can't run springlines from a midships cleat or adjust the fenders forward or aft without getting off the boat or running through the inside with dripping accessories. I wish we had made do with a narrower head, instead. I don't know how big houseboats with 65 feet of flush exterior bulkheads manage to dock the thing, especially in close quarters.